Question

A new truck that sells for $25,000 depreciates (decreases in value) 11% each year. What will be the value of the truck in 2 years?

a) $11,000
b) $17,624
c) $19,803
d) $15,686

Answer 1

The value of the truck in 2 years will be $19,803.

Step-by-step explanation:

To find the value of the truck in 2 years, we need to calculate the depreciation for each year and subtract it from the original price. The truck depreciates 11% each year, so after the first year, the value will be $25,000 - ($25,000 * 0.11) = $22,250. Continuing this for the second year, the value will be $22,250 - ($22,250 * 0.11) = $19,803. Therefore, the value of the truck in 2 years will be $19,803.